FINANCIAL ANALYSIS

Financial Analysis on Google

Name of the Writer

Name of the Institution

Table of Contents

Introduction3

History3

Business Description4

Acquisitions And Innovations5

Competitor Analysis7

Risk Management Plan8

Financial Analysis9

Conclusion and Recommendations10

Appendix12

EXHIBIT 1: Income Statement12

EXHIBIT 2: Balance Sheet13

EXHIBIT 3: Cash Flow Statement14

EXHIBIT 4: Ratio Analysis15

EXHIBIT 5: Search Engine Market Share15

Financial Analysis on Google

Introduction

Way back in 1996, Stanford University graduate students Larry Page and Sergey Brin built a search engine called “BackRub” that used links to determine the importance of individual web pages which led to www.google.com in 1998 (Woodford, 2005). Since then, it is the world's most widely used search engine. This paper discusses the business model of Google and provides a comprehensive financial analysis of the company. Moreover, it also analyzes the competitive environment of the industry and present recommendations.

History

The history of Google dates back to the 1990s when Stanford University graduate students, Sergey and Larry, worked together to innovate a technology for a search engine. They named it BackRub because of its unique ability to analyze the back links referring to a given website. After two years, they gathered USD 1 million funds from private investors and venture capitalists to launch Google. Google was incorporated in 1998. In the beginning, it catered to 10,000 search queries per day. PC Magazine counted Google in one of its top hundred websites and search engines for 1998.

The Google site was presented a Webby Award and a People's Voice Award for technical achievement in 2000. Google launched AdWords to expand its keyword targeted advertising to small-sized businesses. It was an ad program that could be activated online by the user with a credit card. Google is the company to launch the first wireless search technology for WAP phones and handheld devices (Hajdini, 2009).

Business Description

Google is a global technology company with the objective to improve the ways people connect with information. It provides relevant information to users who rely on Google search to resolve their queries. It provides a wide range of services and tools for advertisers all over the world. The company offers its products and services in more than 100 languages, thus catering to the needs of different nations and regions.

The company carries its operations under a single umbrella, which generates profit by offering online advertisements. Although, the major source of revenue for the company and the primary business model hovers around search engine, advertising, operating systems, and enterprise, it retains a vast index of websites and other online content. The company's search engine technologies offer appropriate and useful search results in response to the user requirements. The company also incorporates features into its search engine service and provides advance search services in order to facilitate users narrow down their search. The company's advertising business includes Google Search, Google Mobile, Google Display, and Google Local.

Google's mobile specific search technologies comprises of innovative features such as search by sight, search by voice, and search by location. Moreover, the company also facilitates the advertisers in terms of the mobile-specific as formats and campaigns. For example, the option of click to ad service enables the ...